How Human Capital Development Can Aid in Business Growth

By Marianne Chrisos - Last Updated on January 7, 2020
How Human Capital Development Can Aid in Business Growth

How does a strong and efficient human capital development plan lead to better business?

It is no secret that the teams that makeup businesses drive the success of those companies. Without the people who man the sales teams, create a strategy in marketing departments, deliver financial reports in accounting, and assist customers in service teams, businesses would come to a screeching halt – or at least erode significantly over time. That is why employees are often referred to as human capital – because they are an investment that a company makes in their future success, an asset just like a new accounting program or CMS software.

Investopedia describes the relationship between human capital and strong economic growth by saying, “A company can help increase human capital and increase economic growth as well. For example, consider a computer programmer working at a technology company; she receives on-site training, attends in-house seminars and the company pays for part of her tuition for higher education. If she decides to stay at the firm, she may develop new ideas and new products for the company.”

Infusing the power of human capital development to fuel business advancement.

It is clear, then, that investing in human capital is a smart strategy for companies who are looking to also grow their business.

Human capital development can be things like training, seminars, and conferences focused on helping employees strengthen existing or gain new skill sets; it can also relate to better HR processes that grow corporate communication or improve and enhance recruitment policies.

Here are some of the ways that human capital development can lead to better business growth.

1. Reduced turnover expenses

When time and money are spent investing in employees, employees are more likely to stay. They are more likely to be both engaged in their jobs and good at their jobs. This helps grow a company in a number of ways. First of all, if people want to stay in company, companies are devoting less time and money to searching for people to fill that role again.

This money can be budgeted for new product development, more marketing campaigns, or other business growth initiatives. Additionally, employees who feel like their company cares about them are more likely to be productive, potentially adding revenue or additional business growth through marketing strategies or more engaged account management and business development.

2. Improved hiring

Prospects want to work for a company that is committed to helping them grow professionally. Companies that make human capital development a staple of their company culture and mission will see better quality candidates come through their recruitment pipeline.

3. Greater efficiencies

Not only does human capital development lead to more productive and committed employees, but it can also lead to employees who experience reduced mistakes and greater creativity. This can help businesses reach their goals faster and potentially even in more cost-effective ways.

4. Boosted reputation

An organization’s employees are one of the biggest marketing assets – or liabilities – a company has. Happy employees will do more to push the company brand and even spread the word of the business’s products and services. Apple employees are some of the company’s strongest advocates, in part because they believe in the product, but also because they believe in the company, which works to help support and develop them. A company with a good reputation – which includes employee satisfaction and perception – is more likely to see more business and greater customer loyalty over time.

Improving human capital and employee development is an investment that a company needs to make to see big business benefits. Not only is it essential to helping a business stay operational and profitable, but it’s also key to achieving business growth by potentially freeing up money through employee retention as well as creating more efficient, dedicated employees who want to see the business grow as much as leadership.

Marianne Chrisos

Marianne Chrisos | Born in Salem, Massachusetts, growing up outside of Chicago, Illinois, and currently living near Dallas, Texas, Marianne is a content writer at a company near Dallas and contributing writer around the internet. She earned her master's degree in Writing and Publishing from DePaul University in Chicago and has worked in publishing, advertising, digital marketing, and content strategy.

Marianne Chrisos

Marianne Chrisos | Born in Salem, Massachusetts, growing up outside of Chicago, Illinois, and currently living near Dallas, Texas, Marianne is a content writer at a c...

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